Senator Leahy (D-VT) Introduces Trademark Legislation and Decries Trademark Bullies

According to a press release from Senator Patrick Leahy’s office, the Senator is introducing a bill entitled The Trademark Law Technical and Conforming Amendment Act Of 2010 (S. 2968).

The legislation purports to make some technical and confirming amendments to U.S. trademark lawsuit to help improve the efficiency of United States Patent and Trademark Office (USPTO), including allowing applicants to correct good faith and harmless errors.

More interesting, however, is the requirement in the legislation for the Department of Commerce to study whether large corporations are misusing the trademark laws to harass small businesses by exaggerating the scope of their trademark protection and to report to Congress on any suggested policy changes to protect small businesses. Leahy’s press release statement focused on a particular dispute where Hansen Beverage Co., the maker of the Monster energy drink, sued Rock Art Brewery, a small microbrewery in Morrisville, Vermont (the state that Leahy represents) over its use of the name “The Vermonster” for one of its microbrews (news articles on the dispute here and here):

This legislation also requires a study of how the current system can better protect small businesses from abuses of the trademark system by larger corporations. Congress provides strong enforcement tools to intellectual property owners, as we should, to deter infringing activity and to remove counterfeit products from the market. I have become concerned, however, that large corporations are at times abusing the substantial rights Congress has granted them in their intellectual property to the detriment of small businesses. In fact, we saw a high-profile case like this in Vermont last year involving a spurious claim against Rock Art Brewery in Morrisville. When a corporation exaggerates the scope of its rights far beyond a reasonable interpretation in an attempt to bully a small business out of the market, that is wrong. This legislation therefore directs the Secretary of Commerce, in coordination with the Intellectual Property Enforcement Coordinator, to consider options for protecting small businesses from such harassing litigation, while ensuring that legitimate trademark infringement actions are handled efficiently and expeditiously by the courts.

For a related story involving a different “Monster,” check out these prior blog posts here and here.

[The TTABlog® describes one of the conforming changes made by the legislation to make the renewal deadlines (and grace periods) for trademarks protected in accordance with the Madrid Protocol consistent with the renewal deadlines (and grace periods) of other registered trademarks.]

Busy Busy Busy....

What’s a blogger to do when too busy to post something original – cite to other interesting blog posts, of course.

Seattle Trademark Lawyer Michael Atkins, posting a follow-up related to a declaratory judgment action for noninfringement of alleged trade dress filed by language software company Topics Entertainment Inc. against Rosetta Stone Ltd., provides a lesson about the “first to file” rule of which every lawyer should take note.

Courthousenews posts on the lawsuit filed by Mine O’Mine, Inc. (the corporation which owns the rights of publicity and intellectual property of Shaquille O’Neal) in Nevada District Court over a clothing company’s use of SHAQTUS (a moniker ascribed to O’Neil after he was traded to the Phoenix Suns and was called “The Big Shaqtus” – a play on the name Shaq and the many cacti prevalent in Arizona). See Mine O'Mine, Inc. v. Michael Calmese, True Fan Logo, Inc. and Dan Mortense, Case No. 10-cv-00043 (D. Nev. January 12, 2010) (complaint here). The Las Vegas Sun also ran a story on the lawsuit (link here).

Onpointnews discusses “The South Butt” case and the “cheeky” answer filed by Jimmy Winkleman’s attorneys in response to the trademark infringement lawsuit filed by the owners of The North Face clothing line that seeks to test the bounds of parody protection (and probably making more light of a matter that Mr. Winkleman should probably be taking much more seriously).

Pittsbrgh Trademark Lawyer Dan Corbett posts on the latest lawsuit filed by my favorite litigious cookie company, Eat ‘N Park Hospitality Group, Inc. (prior posts here and here) who maintains that its Section 2(f) trademark registration gives it a monopoly on a smiley face design on a cookie.

While Eat N’ Park has mostly gone after smaller online cookie sellers (and no doubt, convinced many of them to enter into a license agreement rather than continue with a costly litigation fight), it looks like Eat N’ park is finally going after a competitor, Crumbs Corporation, that actually has some money to fight. As discussed in my prior post here (discussing the setback faced by Franklin Loufrani’s SmileyWorld at the TTAB),

[G]iven that it took a “truly impressive” amount of money for Wal-Mart to stake a claim on a “ubiquitous, non-inherently distinctive design” that has become a “common feature of modern American culture,” one wonders if Eat ‘N Park can continue to claim exclusive rights to its “smiley” cookies when most (if not all) of Eat ‘N Park’s defendants are merely decorating a cookie with that captures this famed ornamental symbol.Does anybody out there really think that Eat ‘N Park has the same “impressive” advertising dollars to back up its claim of acquired distinctiveness? As the TTAB stated “Considering that we have already determined that the smiling face is a common feature of modern American culture, [acquired distinctiveness] will not be something easily achieved."

Finally, Ron Coleman’s Likelihood of Confusion® dispenses some detailed advice to an unnamed attorney with a client looking to establish a brand around the title or other reference that suggests a particular famous movie or scene therefrom. The cartoonish figure pictured above dispenses some of the most detailed and insightful free legal advice I’ve read online in a long time.

Minnesota Indian Casino Sues Local Henderson Casino Over MYSTIC name

Mystic Lake Casino Hotel in Minnesota

Las Vegas Sun reporter Steve Green reports on the trademark infringement lawsuit filed in Nevada District Court by the Shakopee Mdewakanton Sioux Community (“Shakopee”) against Templeton Gaming Corporation (“Templeton”) and its owner Hugh Templeton (link to story here) [I am quoted in the article]. See Shakopee Mdewakanton Sioux Community v. Templeton Gaming Corporation et al., Case No. 10-cv-00010 (D. Nev). A copy of the complaint can be viewed here.

Shakopee owns the Mystic Lake Casino Hotel in Scott County, Minnesota (near Minneapolis). Templeton owns a local video poker bar in Henderson, Nevada going by the name Mystic Lodge Casino.

Mystic Lodge Casino in Henderson, Nevada

While Shakopee appears to promote its services primarily using the mark MYSTIC LAKE, it also happens to own a trademark registration for the word mark MYSTIC in connection with “entertainment services, namely providing casino facilities” registered January 6, 1998. While Shakopee also owns numerous other registrations containing the word MYSTIC in connection with goods and services related to its casino/hotel operations (a “family of marks” as Shakopee would likely describe it), this single registration alone gives Shakopee some strong ammunition against companies that wish to use the word MYSTIC in connection with a casino related business.

While Shakopee appears to have the upper hand in making a legal argument against Templeton for likelihood of confusion based on the Sleekcraft factors, all I could think about with this case was that it looked like a “Dawn Donut” situation. See Dawn Donut Co., Inc. v. Hart’s Food Stores, Inc., 267 F.2d 358 (2d Cir. 1959). As described recently by the Nevada district court in Kerzner Int'l, Inc. v. Monarch Casino & Resort, Inc., 2009 U.S. Dist. LEXIS 116622 (D. Nev. December 14, 2009) (blog post here):

Under the Dawn Donut rule, even if a federal registrant has rights in a mark, it is not necessarily entitled to an injunction against an unauthorized user: “if the use of the marks by the registrant and the unauthorized user are confined to two sufficiently distinct and geographically separate markets, with no likelihood that the registrant will expand his use into the defendant’s market, so that no public confusion is possible, then the registrant is not entitled to enjoin the junior user’s use of the mark.” Dawn Donut, 267 F.2d at 364 (footnote omitted); see also Fairway Foods, Inc. v. Fairway Markets, Inc., 227 F.2d 193, 198 (9th Cir. 1955) (vacating injunction issued to prevailing plaintiff on essentially the same basis as later became known as the Dawn Donut rule). Only once the federal registrant has expanded its use of the mark, so that the market areas of the two users are no longer separate and distinct, will the registrant be entitled to an injunction. Mister Donut of Am., Inc. v. Mr. Donut, Inc., 418 F.2d 838, 844 (9th Cir. 1969) (citing Dawn Donut).

Given that the tribe’s operation of its casino is certainly bound by its Indian territory boundaries and not likely to expand its use of the Mystic mark into the into the Henderson, Nevada area where this small locals casino operates, should Shakopee be allowed to stop them from using the name until such time as Shakopee expands into the Las Vegas market?

Of course, any discussion of “Dawn Donut” would not be complete without raising the issue of whether in this day and age of nationwide commerce through the Internet, whether “Dawn Donut” is relevant any more. The following are two excellent articles focusing on this particular issue:

• Stephen Quigley, “Is 'Dawn Donut' Dead in Internet Age?”. New York Law Journal, May 19, 2008
• Jessica Amber Drew, “Death of Dawn Donut: The Demise of Concurrent Trademarks,” 2007 U. Ill. J.L. Tech. & Pol'y 145 (Spring 2007).

Indeed, Shakopee's argument would certainly be that while its casino business is limited to its tribal area in Minnesota, its reputation (thanks to its traditional and Internet marketing) is nationwide and thus, consumers visiting the Henderson, Nevada area who come across this locals place may believe that there is an affiliation between this "Mystic Lodge Casino" and that other "Mystic" casino in Minnesota with which they are familiar or about which they have heard.